It also operates more than 600 stores internationally as of the end of June. Texas-based private equity firm TPG Capital LP began due diligence on Billabong earlier this summer after also offering $1.48 per share for Billabong in July. The TPG offer is its third for Billabong, and comes in lower than two previous bids of $825.3 million and $909.2 million made earlier this year. Billabong said it had signed a confidentiality agreement with this latest bidder and also is allowing the entity to conduct due diligence on the company. Billabong International (ASX: BBG) has today announced that it has received a second proposal from a different party, offering to buy all the shares in the company for a cash consideration of around $1.45 per share. That's the same amount proposed by private equity firm TPG International LLC, back on 24 July. The board of Billabong have rejected this bid as well, saying it also undervalues the company. After reporting a $276 million loss for the 2012 financial year, Billabong has been under pressure to turn around its business and reduce its debt. The company recently raised $225 million in a capital raising and sold half of its Nixon brand for US$285 million.
A full year loss of $276 million was recorded amid a huge restructuring plan to be led by new chief executive Launa Inman. Earlier this year it also announced it would shut 82 stores due to lower sales, specifically in Europe. This latest announcement means Billabong has now received three private equity bids in just six months - two from the same bidder. "The board of Billabong today announces that, following the close of trade on Wednesday, 5 September 2012, it received an indicative, non-binding and conditional proposal from another party interest in acquiring all the shares in the company," it announced this morning.
Despite now having two confirmed suitors, Billabong is still trading below the tentative $1.45 per share bids from TPG and a rival party which has chosen to remain anonymous. Shares were trading 10 cents higher at $1.37 after the company announced this morning that the board had received an indicative, non-binding and conditional proposal from another party which has already signed a confidentiality agreement and is expected to commence due diligence at any time.
TPG offered A$1.45 a share, or A$694 million ($707 million), in July. The second company offered "around A$1.45" a share, has signed a confidentiality agreement and has been granted due diligence, Billabong said in a statement on Thursday. Both offers are indicative, non-binding and conditional, and the offer price may be refined after perusal of Billabong's books. Since TPG's first approach in February, Billabong has sold half its of watch brand Nixon, issued a profit warning, hired a new chief executive and raised A$225 million in equity to reduce debt. TPG, which has built up a 12.5 percent stake after winning over two institutional shareholders, had offered A$3.30 per share in February but Billabong rejected it, saying it did not reflect the company's underlying value. Since that first approach from TPG, Billabong has sold half of its watch brand Nixon, issued a profit warning, hired a new chief executive and raised A$225 million in equity to reduce debt. The second approach was made in July. Billabong, which had undertaken an aggressive expansion, has been struggling with weak sales of its top brands amid tough competition and a weakening retail environment. The company last month outlined a four-year plan to simplify its business and revive sales, although it conceded investors would have to wait two years for the biggest benefits to flow through.
"The board does not intend to make any further announcements unless and until a recommended offer is secured, or unless there is a development which it considers requires disclosure," the company said. It said this process is expected to take several weeks.Since TPG's first approach in February, Billabong has sold half its of watch brand Nixon, issued a profit warning, hired a new chief executive and raised $225 million in equity to reduce debt.
Related previous posts:
Aucun commentaire:
Enregistrer un commentaire